The management revolution in the U.S. workplace has gained momentum. Performance management is out. Performance motivation is in.
The dreaded annual review process—bureaucratic, form-heavy, often dreaded by both managers and employees—is out. Performance conversations—frequent, agile, light on formality but heavy on coaching and two-way feedback—are in.
With all this in mind, Security Management explores the roots and reasons for this trend and asks management experts to provide best practice guidance and principles on how security mangers may conduct effective and engaging performance conversations.
Annual Review Issues
Many managers first became aware of significant changes in performance reviews around 2012, when the digital media company Adobe publicly announced that it was abolishing the traditional annual review process.
As a result, Adobe's voluntary turnover was reduced by 30 percent, according to a Deloitte report, and other firms began following its lead.
In late 2016, the movement received another big boost when one of the largest companies in the world, Accenture, announced that it was joining the revolt.
"Imagine, for a company of 330,000 people, changing the performance management process—it's huge," Accenture CEO Pierre Nanterme told The Washington Post. "We're going to get rid of probably 90 percent of what we did in the past."
Meanwhile, smaller organizations have taken their cue from these corporations. "People management practices tend to be a follow-the-leader game," says Phil Haussler, an HR expert at Quantum Workplace who studies workplace and management issues.
In one sense, the changes were understandable, given that so many workers on different levels—from front line employees to senior management executives—have expressed concerns about the annual review process.
"I think the revolution is at least acknowledging the underlying problems of performance reviews—such as that everyone hates them, and they are not that useful," says Jordan Birnbaum, the chief behavioral economist for ADP.
Moreover, many of these concerns are supported by research, adds Birnbaum, a behavioral economist who is familiar with studies in his field (as is Haussler) that have shown that the annual review practice can be problematic.
For example, research shows that the common annual review process of linking a performance evaluation to a pay raise largely destroys the development aspect of the assessment. When this linkage is present, it is natural for an employee to switch into an impression management mindset, rather than focus on how the information can assist in professional growth.
"For the employee, it can become more about posturing, making sure that I show my best self," Haussler explains.
Another undermining effect of this linkage is that it negatively affects motivation. Research has shown that intrinsic motivation (doing something because it has inherent value) is a much more powerful and productive driver than extrinsic motivation (doing something in exchange for a tangible reward).
One study, for example, looked at children enthusiastically playing a game. When study supervisors told the children that they would receive a prize if they won, the children quickly lost interest, Birnbaum explains.
It's also difficult to ensure that the annual review is based on sound, accurate data. Studies show that if managers or employees know that their performance feedback will be read by others, they are likely to inflate it, by a fairly large standard deviation, Birnbaum explains.
One reason for this is that it is often in the manager's best interest to give a glowing review—it can help the department look good in the eyes of senior management. Similarly, if the employee knows that senior management will read the review, he or she may not be honest with their criticism of a manager, for fear that it will cause a rift in their relationship.
The other big issue that plagues the annual process is bias, which in this context researchers call the "idiosyncratic rater effect."
"We are all terribly biased," Birnbaum says. Studies show that in performance reviews, one behavior, good or bad, can have undue influence on the entire evaluation.
For instance, take an employee who is always late to meetings who has a manager that hates lateness. The employee may find that the manager's strong feeling about lack of punctuality may bleed into other unrelated areas of the evaluation, causing a lower-then-deserved ranking.
"The feedback is more about the person who's providing it, than about the person who's receiving it," Birnbaum explains.
Given these problems, the traditional annual review may now be "on life support," as Haussler says. But is not completely dead. Some companies are retaining the annual review but changing its evaluation methods and process in hopes of improving it.
But many companies that are retaining the annual review in some form are still making use of more frequent one-on-one performance conversations between managers and employees. These conversations range widely and include anything from once-a-month (or even once-a-week) casual check-in conversations to more structured quarterly meetings that incorporate two-way feedback, coaching, professional development guidance, brainstorming, and career advice.
"There's not one single practice that we are seeing everyone move to—it's all on a spectrum, and each organization decides for itself how far it wants to move on the spectrum," Haussler says.
Five Principles, Four Questions
How can security managers adopt the practice of regular performance conversations? Leadership and workplace communications expert Skip Weisman provides some best practice guidance that may help in implementation.
First, Weisman lays out five keys to effective performance appraisals: Begin with clear expectations; have regular conversations; capture and log performance; provide "feedforward;" and focus on helping.
Second, Weisman suggests that one-on-one meetings themselves can be designed around four basic questions for the employee: What do you think you did well this month? What is something you feel you need to get better at? What obstacle or obstacles got in your way and hindered your performance? Where do you need help, and what can I do to help you?
Although brief, the four-question format makes the structure of the meeting clear to both the manager and the employee. It also provides an opportunity for an open, fruitful two-way discussion.
For example, let's say the employee thought his or her performance on a certain task was outstanding, but the manager believed it was subpar. Discussing this discrepancy gives the manager the opportunity to clarify task expectation, and it gives the employee an opportunity to explain what his or her day-to-day is like in the trenches.
"In the workplace environment, the employee is seeing things and experiencing things from their own perspective," Weisman says. "The manager should be asking about this and be open to hearing it."
This two-way concept is key, Haussler agrees, and it should apply from the beginning of the process because the manager should not dictate what will be discussed. The employee should be the primary driver of the agenda.
"The employee owns their career, and the employee earns their conversation," Haussler says. The process may work even better if both participants have a chance to confer days before the meeting and decide what will be discussed, he adds. This gives both the time to consider the points they would like to make, instead of "just showing up with a pad and pencil."
In terms of the frequency of the meetings, Weisman advises (under his second principle) that the conversations be frequent—at least quarterly, if not once a month. Haussler agrees, and adds that research his firm has conducted on employee engagement has found that the most engaged employees have meaningful performance conversations at least once a month, if not more frequently.
Another benefit of frequent meetings is that it can help transform managers into coaches, a common organizational goal. "A coach would never give performance feedback only once a year," Haussler says.
And some organizations are going all-in on this transformation by offering coaching training and resources to their managers, to help them move toward a continuous coaching practice that improves employee engagement.
Of course, in cases where a manager has a large staff, the manager may be concerned that having a performance conversation with 10 direct reports once a month will be too burdensome timewise.
But Haussler says that this time issue should be put into perspective. By one standard, an effective manager invests roughly 200 hours per year into coaching staff, which breaks down to roughly 16 hours per month. If the manager has 10 direct reports, a 20-minute monthly meeting with each of them should consume roughly four hours of coaching time every month. That should be workable; if the manager sees that as too burdensome, then "maybe they ought not to be a manager," Haussler says.
Under Weisman's four-question model, the conversation begins with a recognition of positive accomplishment. This is critical for a few reasons, experts say.
One is that many busy workplaces fall under a kind of unspoken rule: if employees are doing things well, they don't need to be recognized; feedback is only needed to point out and correct mistakes. "Typically, a lot of employees don't get a lot of positive feedback," Weisman says.
But this can lead to problems, such as employees who feel undervalued. Moreover, studies show that negative feedback is best processed and learned from when it comes with five to seven bits of positive feedback, Birnbaum says.
One 2004 study of teams, for example, found that the highest performing teams received 5.6 positive statements for every negative statement. Without these positives, the employee feels the feedback isn't fair because positive accomplishments are not recognized.
"Human beings' psyches are fragile. It's very tricky to provide feedback that is useful and not harmful," Birnbaum explains.
Thus, starting out the conversation with what was done well allows managers to recognize accomplishments, and explain how they matter to the organization's success, which bolsters employee engagement and helps trigger intrinsic motivations, experts say.
When the second question of "What is something you feel you need to get better at?" is discussed, Weisman recommends that managers use the "feedforward" approach, a concept attributed to management expert Marshall Goldsmith.
For example, if the employee brings up a task that he or she failed at, the manager should direct the conversation forward and focus on the coachable moment of how performance of the task could be improved in the future.
Brief summaries of the discussion of both these questions can be recorded by both manager and employee as part of an ongoing effort to capture and log performance. So, if the one-on-one meetings are monthly, and the company is retaining its annual review process, the 12 months of summary notes will make the end-of-year review paperwork much easier for both parties, allowing both to avoid trying to document a year-long evaluation in one review.
The last two questions of the performance conversation model—"What obstacle or obstacles got in your way and hindered your performance? Where do you need help, and what can I do to help you?"—are critical, because they reinforce the open and two-way nature of the conversation, Weisman says.
One common employee criticism of the traditional annual review is that it can turn into a one-way grilling of the mistakes the employee has made throughout the year. However, the third question gives the manager an opportunity to walk a mile in the employee's shoes, and better understand what challenges he or she is facing, the overall working conditions, and the factors that impact his or her performance.
Building on this concept, the fourth question of "Where do you need help, and what can I do to help you?" keeps the focus on the employee's perspective and allows the employee to provide feedforward to explore how a process could be changed, or what a manager could do differently in the future.
For example, say an employee feels he or she is fighting burnout due to a heavy workload. This can lead to a discussion where the manager and employee go through tasks and decide which could possibly be minimized, jettisoned, or outsourced.
Such discussions fulfill Weisman's final principle of a focus on helping. They also reinforce perhaps the most important message of the performance conversation—it is a two-way street in which both parties try to help each other improve, regardless of rank or position in the company.
"No one stops learning. No one stops growing," Weisman says.